Department stores saw a notable current value decline in 2020, due to temporary outlet closures as a result of the pandemic, as well as consumer caution in spending on non-essentials. However, the channel showed dynamic recovery in 2021, far exceeding the pre-pandemic level of sales.
After outlets reopened, beauty and personal care products, and especially luxury and premium beauty brands, saw a significant rebound in department stores. Some outlets saw beauty and personal care products post double-digit sales growth even from as early as April 2020, thereby playing a leading role in business recovery.
Due to outlet closures during the pandemic, players accelerated their digital transformation and the integration of online and offline solutions in the channel. One clear move was to target the younger generation, with livestreaming being leveraged as a marketing tool to attract these consumers.
As in many other retail channels, in order to attract consumer traffic to stores, numerous department stores have created immersive shopping experiences, offering multiple consumer engagement scenarios, including art spaces, IP culture galleries, parent-child “paradises” and other entertainment areas. The aim is to build a modern and young brand image and extend consumers’ stay in stores.
Although the online sales of department stores have increased significantly, the same was also true for in-store sales in 2021. With the consumer desire to shop flexibly both online and offline, omnichannel integration has become a crucial trend for department stores, offering both physical stores and an online platform, and showing real-time inventory.
Since overseas travel was disrupted and the global recovery remained below expectations, tourism and luxury/premium consumption flowed towards domestic retailers in 2020 and 2021. Meanwhile, the Chinese government increased its efforts to maximise domestic consumption to offset the impact of COVID-19 on economic growth.
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Understand the latest market trends and future growth opportunities for the Department Stores industry in China with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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Outlets selling mainly non-grocery merchandise and at least five lines in different departments, usually with a sales area of over 2,500 sq metres and arranged over several floors. Example brands include Macy’s, Bloomingdale’s, Marks & Spencer, Harrods, Sears, JC Penney, Takashimaya, Mitsukoshi, Daimaru, Karstadt, Rinascente.
See All of Our DefinitionsThis report originates from Passport, our Department Stores research and analysis database.
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